Nick McKenzie and Richard Baker

A Melbourne developer has accused Victoria's powerful construction union of demanding he employ union boss John Setka's brother-in-law and his best friend on $70,000 a year jobs in return for securing industrial peace.

Fairfax Media obtained CCTV and other recordings, along with an interview with Peter Chiavaroli, a builder and developer of the old Pentridge prison site in Coburg, which provide an insight into the backroom dealings of union officials, figures aligned with Melbourne's underworld and bikies.

• Underworld associate Mario Amenta saying he was dispatched by Mr Setka to "sort out" problems on the old Pentridge prison site.

Illustration: Ron Tandberg.

• Union officials abused non-union workers, employers were pressured to "give a kicking" to non-union members, and Mr Setka describing one as a "f---ing dog, Turkish painting piece of shit".

• Subcontractors threatening to use Comanchero bikies to collect a disputed debt.

The Pentridge allegations add to previous claims by building companies Boral and Grocon and industry whistleblowers that the CFMEU threatens companies unless they cede to union demands, and will increase pressure on Labor leader Daniel Andrews over Labor's close ties to the union.

Peter Chiavaroli.

In an interview with Fairfax Media, Mr Chiavaroli alleges that in late 2009 Mr Setka demanded the employment of one of his closest friends, Anton Sucic, as a shop steward as part of a campaign to unionise the site.

Mr Setka was the union's assistant secretary when the demand was allegedly made.

Mr Chiavaroli alleged that he was accompanied by Mario Amenta, a concrete company owner who is a close associate of gangland boss Mick Gatto. Mr Amenta once assisted murdered gangster Mario Condello obtain bail.

John Setka. Photo: Wayne Taylor

"I told them I had already made arrangements and I had interviewed someone who was going to start next Wednesday. Setka said, 'no that is not going to happen','' Mr Chiavaroli said. ''He [Setka] didn't ask me, he told me that I must employ his compare, Anton. If I didn't co-operate and employ people he suggested that he would shut down the place for good.''

Of Mr Amenta, Mr Chiavaroli said: ''I was told that he is No.2 behind Mick Gatto and if I wanted to have peace, they could organise it.''

A CCTV recording later captures Mr Chiavaroli discussing with Mr Sucic how Mr Setka had said his hiring ''is not negotiable''.

The Pentridge site was largely non-union until a worker was killed in October 2009. After the death, the CFMEU mounted a fierce campaign to unionise and control the worksite, claiming it had been issued a ''record'' amount of safety notices by Worksafe.

In a statement, Worksafe said the number of Pentridge safety notices was ''average for the construction industry''. After Mr Sucic left the site in 2010, Mr Chiavaroli said the CFMEU directed him to employ Mr Setka's brother-in-law, Ivan Dadic, or risk an escalation of industrial disruptions, which were by then occurring as the union pushed Mr Chiavaroli to agree to its demands regarding pay and conditions.

Time-sheets from the site reveal Mr Dadic often failed to arrive at work or left early, while CCTV recordings capture him describing how the union coerced workers to join. Mr Dadic is taped saying that if the non-union worker's boss ''doesn't give him a kicking'' then pressure is applied to the company to for it to ''move [the worker] off the site or make him join or pay for him''.

It is illegal to demand a person join or not join a union or to threaten a company if a worker decides not to become a member.

''We don't want to write this down, but that company [employing non-union labour] would be sat in the sheds and pointing the finger at this bloke,'' Mr Dadic says. ''He'd be named and shamed and, if that didn't work, more of the site would be shut down.''

Recordings capture senior union officials becoming abusive after learning that a non-union painter at Pentridge had complained to the Australian Building Construction Commission that the CFMEU attempted to force him to join. In a tape-recorded message, Mr Setka describes the painter as a ''f---ing dog, Turkish painting piece of shit''.

In another recording, union official Gerry Benstead warns Mr Chiavaroli's company against reporting alleged union coercion to the ABCC, which held concerns about the site but was unable to convince witnesses to testify.

''If Johnny Setka hears about that, friggin' that'll be the end of it,'' Mr Benstead says. ''If you go running to the ABCC, forget about it. That will be the worst move you'll ever make.''

In the same recording, Mr Benstead suggests that Mr Chiavaroli's firm work outside of industry laws. At the time, Mr Benstead was pushing for certain workers to be given entitlements opposed by the company.

''Everything works on a bit for youse and a bit for us. Forget about the law, all right,'' he says.

Mr Chiavaroli said several of his contractors who resisted union pressure were told, ''We know where you live and we will get you.''

Mr Chiavaroli has also alleged he hired industry consultant and state ALP official Ken Hardy on a $100,000 a year salary after Mr Hardy claimed to have connections to senior union and Labor figures that would help reduce union disputes. He alleges Mr Hardy suggested making a $50,000 payment to Mick Gatto to ''sort out'' union problems and said that hiring Mr Gatto's crane company would be beneficial.

In a video from the Pentridge Village site, Mr Amenta is taped mediating a payment dispute between sub-contractors and warning that if the issue wasn't resolved, Mr Setka would intervene. ''Now I am here because Setka has rung me [and said], 'Go and f---ing sort it out. Otherwise, I [Setka] am going to go there.' I said, 'John, leave it to me'.'' ''I just don't want him [Setka] to come down here'' to Pentridge. Mr Amenta is also recorded saying how he tried to stop Mr Sucic causing industrial unrest.

''I begged him to walk away from the job. The f---ing problems he was going to cause here, you got no idea.''

In an interview, Mr Chiavaroli said: ''Mario said if I played the card right everything would be OK and we would not be shut down for months and we would probably get up and finish the job.'' Mr Amenta told Fairfax Media Mr Chiavaroli's allegations were ''bullshit''.

The Pentridge site remains only partly finished, having faced financing problems.

In a statement, CFMEU national secretary Dave Noonan defended the union's conduct on the Pentridge site, noting that Mr Chiavaroli was a ''Liberal Party donor'' and said Mr Setka had engaged in no inappropriate activity and would make ''no apology for his [Setka's] passionate fight for safety on a site where a worker has just been killed''.

3 Jul
Daniel Andrews has never met John Setka. The Opposition Leader may at least take some comfort in that, because clearly the damaging allegations of construction union malfeasance are not going to go away.

2 Jul
Several close friends and personal business associates of union boss John Setka and other CFMEU officials have benefited after the union used its influence to promote them, their businesses or building sites.

2 Jul
A senior union organiser warned a Melbourne developer that if he reported allegations to the federal building watchdog that workers were being forced to join the CFMEU it would be "the worst move you'll ever make".

2 Jul
Mario Amenta will do anything to help a mate. In 2005, when violent gangland figure Mario Condello was seeking bail after being charged with murder, Mr Amenta offered to employ him in his concrete company.

3 Jul
Employment Minister Eric Abetz says the new Senate must urgently pass laws to restore the full powers of the building industry watchdog, seizing on new revelations of construction union stand over tactics and links to the underworld.

28 Jan
A company controlled by crime figure George Alex has been supplying contract labour to the building site at Barangaroo with the knowledge and support of senior figures within the NSW branch of the building workers' union.